DWP unveils first ever Universal Credit fraud and error stats

The Department for Work and Pensions (DWP) has published its first annual fraud and error findings for its Universal Credit (UC) welfare reform programme as part of a wider benefit system report for the 2015/16 period.

According to the latest DWP figures, overpayment rates for the programme were recorded at 7.3% during the last full financial year, amounting to £36m. Of this figure, 5.4 percentage points were attributed to fraud, with remaining overspend said to have resulted from claimant or official error.

Over the same period, total underpayment to claimants was recorded at 2.6%. Official error was attributed to 2.3 percentage points of the underpayment figures.

DWP compared the 7.3% overpayment via UC to the 5% figure from Jobseeker’s Allowance (JSA), but noted that the comparison was not "statistically significant".

"As UC is still being rolled out across Great Britain, expenditure on this benefit (£477m in 2015/16) is much lower than on JSA (£2.4bn in 2015/16)," said the DWP findings.

"The monetary value of overpayments on UC is correspondingly lower, at £35m, compared with £120m for JSA."

The department did warn that any comparisons with JSA should be treated with caution and was not a like-for-like measure, with the caseloads for UC becoming more complex as the benefit’s roll out is expanded to cover more claimant types.

"Although the majority of UC claims start out as the equivalent of a simple JSA claim, such as a single person without children or housing costs, they can change their circumstances over time and remain on UC," said the findings. "We estimate that 35% of the UC caseload was in employment and 36% of the caseload had housing costs, making these cases more complex to administer."

Universal Credit has been devised as a means to merge employment and support allowance, income support, child tax credit, working tax credit, and housing benefit into a single payment, with a new IT system currently under development by DWP to administer and manage the combined payments.

Currently available at eight UK job centres as part of ongoing trials, the enhanced digital system of Universal Credit – known as the full service – is expected to be rolled out across the UK in a gradual development process that will include linking up with some form of identity assurance tool for users.

As part of this process, DWP said earlier this month it was yet to make a decision over its identity assurance needs for Universal Credit, which would include evaluating whether it will look to make use of the GOV.UK Verify platform as a means of ensuring claimant ID.

"Currently claimants prove their identity by showing ID to their work coach. We are evaluating the Verify system and will announce any plans in due course," said a spokesperson for the department at the time.

As part of an overall of identity management, DWP has also chosen Dell to support use of the legacy Government Gateway ID service as it looks to decommission the technology going forward.

However, no date has yet been set for when the department would look to wean itself off using the technology, with questions having been raised over whether there is any active plan to end reliance on Government Gateway.

Aside from identity management issues, the DWP last year found itself coming under criticism by the National Audit Office (NAO) over concerns about its ability to meet key fraud and error reduction targets for benefit expenditure for the 2014/15.

Auditor General Amyas Morse in July cited ongoing concerns about the "unacceptably high level" of fraud and error around benefit provision that highlighted a need for better management of data by the department.

The efforts were seen as being hampered in part by the delayed rollout of the full UC service, which is not expected to be completed until around 2020.